How To Get Higher Yield On Your Buy To Let Investment

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Research done by a mortgage company revealed that buy-to-let investment UK yields decreased from 6.3% a year earlier to 5.7% in the first quarter of 2022.

But should that affect your investment decision?

Of course not.


Because buy to let investment is a profitable property investment strategy that can help you gain a higher yield in the long run.

Location plays a significant role in influencing higher yields on this type of investment. Also, cities with a large student population have a high potential return.

This blog discusses the best buy to let property areas in the UK and tips to keep in mind to yield higher returns.

So, without further ado, let’s get started.

Best Buy To Let Mortgage Rates

A buy to let mortgage enables you to borrow money to buy a home that can be rented rather than used for personal use.

The required buy to let mortgage requires a deposit of 20-40%, depending on the provider. 

Mortgages for buy to let properties are offered in fixed, discounted, and tracker agreements, with arrangement costs, typically ranging from 1.5 to 2%.

There is no best buy to let mortgage rates because the interest rates vary depending on several variables, including the cost of the home, your credit score, the size of your down payment, and the type of mortgage you select. 

You can use different calculators to check and find the best rates for your buy to let mortgage to simplify the process and ensure you get the best rates.

Best Buy to Let Areas in the UK for 2022

As mentioned above, location influences higher yields on buy to let investments and cities with prominent student populations yield the highest returns. 

So what are the best areas you can invest in for buy to let investment in the United Kingdom?

Track Capital, a property investment company, has analyzed 1350 postcode districts in the UK and found the best and worst performing places for property investors. Here, you can find the top 25 cities by yield rate.

You can filter out the best areas that you want to invest in.

For instance, Manchester has a large concentration of university-going students living there, so the average yield on buy to let is over 10.1%. 

In general, the north of England continues to excel at producing steady high yields while managing growing rents, home prices, and demand.

Is buy to let Still a Good Investment?

That’s a straightforward yes! 

When done correctly, if someone is selling a buy-to-let property to you then this investment can produce fantastic profits, but you must first recognize that this won’t always happen instantly. 

And, if you haven’t done enough research, you may buy a property that offers you nothing in the way of rental income or capital appreciation.

The key to finding a fantastic buy-to-let property UK is to look for properties that will generate a good return for you over time and operate within your budget. 

For example, whereas prices have climbed just 6% in the North East, they have increased 75% on average in London since 2005. 

This does not imply that buyers in the North-East have lost money on their buy to let investments. Whether supply equals or exceeds demand, some properties will have done quite well, while others won’t have increased.

So, whether you want to invest in financial products, a pension, or even real estate, make sure you weigh all the advantages and disadvantages and know the potential returns for each.

9 Buy to Let Tips for Beginners

buy to let tips

Now that you understand buy to let investment better, you don’t want to rush and make impulse buying decisions.

Here are nine tips for beginners to ensure you achieve the best investment returns.

  1. Be open-minded about your search location.
  2. Pick a property that is easy to maintain.
  3. Keep your credit score up.
  4. Invest in a landlord scheme covering property damage and lost rental income.
  5. Compare interest rates and choose the one that fits you the best.
  6. Try to secure more than a 20% down payment for better deals.
  7. Think about your target tenant.
  8. Avoid costly renovations.
  9. Hire a property management company.

Using these tips, you can kick-start short-listing the best areas in the UK for buy-to-let investment and ensure you generate a decent monthly income.

Make A Great Investment By Buying a Property To Let UK 

Look for great buy to let properties for sale that can deliver a higher yield and secure your investment for the long run.

Research or hire a local agent that can streamline the process and help you minimize the complexities of the investment process.

If you want the best property investment assistance, you can choose Pluxa Property to get the best deals in the United Kingdom on buy to let properties. 

With over ten years of experience in assisting many investors and landlords solve their property management issues, we can assist you with the same.

Make a wise decision and achieve great financial success for your property investment business.


Is it illegal to live in your buy to-let property?

It is typically a requirement of the mortgage that you rent out the house. But if you are moving into a home that you own with a buy to let mortgage, that is not illegal. Also, if you violate the agreed terms, your lender may be entitled to demand full repayment of the mortgage, and if you cannot do so, they can retake possession of the property.

Can I buy to let my first property?

Yes, you can. Though mortgage lenders see the buy to let loan as a higher risk, many mortgage lenders might need a bigger down payment or anticipate a greater rental yield. If you can provide them with at least a 40% down payment, the loan processing can be smooth, and you can purchase your first buy to let property.

Can selling my buy-to-let properties be possible?

Landlords have the option to buy to let for sale properties with tenants or without tenants. Vacant homes may fetch a higher sale price because there’s minimal chance of damage and repair costs involved. But if you want to sell the property with tenants living in the space, the number of potential buyers will decrease, and it can become hard to get decent selling returns. 

How to avoid capital gains tax on buy to let property?

The amount of Capital Gains Tax (CGT) you will pay on buying your buy to let property can be reduced in several ways, but you should always seek expert advice first. One of the significant ways is to reinvest the amount into a new property.


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